Palladium is once again under pressure and has not been able to break out of a falling wedge resistance trendline, with price action indicating the bears have taken control.
Technical charts analyzed by market analysts display the metal trying to establish a breakout but failing as trading is fading near important resistance levels.
Importantly, the rejection follows a period of recovery, during which palladium is caught up in a larger downward trend. On the daily time frame, traders could be waiting for a better reversal signal or another approach to lower support levels.
Palladium Faces Rejection at Falling Wedge Resistance
This daily chart displays a falling wedge pattern as palladium oscillates between its higher- and lower-time-frame levels, failing to break out even once.
DGDxtrader says the gravestone doji was observed on Monday, following palladium’s arrival at the trendline resistance, as an indicator of strong selling activity. The next spinning top candle further confirmed market hesitation with the lack of buying strength to push prices above the resistance zone.
The bearish continuation candle has added fuel to the fire of bears, giving the metal sellers a decisive advantage in the short term. The palladium structure suggests that palladium is still moving below important levels, continuing the uptrend.
The downward formation in a wedge is the focus of technical traders as they stay tuned. Any price action above the resistance level may alter the structure, but overall price action is more consistent with a cautious stance.
Precious Metals Sector Shows Mixed Performance
SilverTrade’s market data revealed some weakness in precious metals in the latest session. Meanwhile, palladium fell, as did silver and gold.
In precious metals, palladium was sold lower, in line with the rest of the market. The currency maker rose while others waded in, resulting in mixed results for the industry.
Palladium’s weakness comes amid a time when the metal had been trying to bounce back from previous declines. The recent rejection near resistance, however, is a sign that the buyers have yet to gather enough momentum to turn the trend.
The industry remains sensitive to modifications in the expectations of demand, industrial activity, and overall market positioning. Palladium is especially vulnerable to the automotive demand, as it is widely used in the industry.
Traders Monitor Support Levels for Possible Reversal
Another chart that market participants shared shows palladium has come to some key support levels following the recent drop. The valuations point towards a possible reversal area should buyers enter around these lower values.
The chart pattern is an interesting one as palladium had a nice recovery but then went into another pullback. Wherever there had been signs of a buying interest, the price is now testing.
But it’s not a time of strength for momentum indicators as the market continues to look for confirmation of a sustained recovery.
The lack of support may prolong the current bear market, and the potential for increased demand could lift palladium back up against the resistance.
Meanwhile, traders are watching closely if the metal can find a bottom following the recent rejection. Palladium is sitting at a crossroads between a pullback to support and a lack of momentum, for now.